Correlation Between Asiabasemetals and First Majestic
Can any of the company-specific risk be diversified away by investing in both Asiabasemetals and First Majestic at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Asiabasemetals and First Majestic into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Asiabasemetals and First Majestic Silver, you can compare the effects of market volatilities on Asiabasemetals and First Majestic and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Asiabasemetals with a short position of First Majestic. Check out your portfolio center. Please also check ongoing floating volatility patterns of Asiabasemetals and First Majestic.
Diversification Opportunities for Asiabasemetals and First Majestic
-0.38 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Asiabasemetals and First is -0.38. Overlapping area represents the amount of risk that can be diversified away by holding Asiabasemetals and First Majestic Silver in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on First Majestic Silver and Asiabasemetals is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Asiabasemetals are associated (or correlated) with First Majestic. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of First Majestic Silver has no effect on the direction of Asiabasemetals i.e., Asiabasemetals and First Majestic go up and down completely randomly.
Pair Corralation between Asiabasemetals and First Majestic
Assuming the 90 days horizon Asiabasemetals is expected to generate 2.6 times more return on investment than First Majestic. However, Asiabasemetals is 2.6 times more volatile than First Majestic Silver. It trades about 0.04 of its potential returns per unit of risk. First Majestic Silver is currently generating about -0.35 per unit of risk. If you would invest 8.50 in Asiabasemetals on August 27, 2024 and sell it today you would earn a total of 0.00 from holding Asiabasemetals or generate 0.0% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Asiabasemetals vs. First Majestic Silver
Performance |
| Timeline |
| Asiabasemetals |
| First Majestic Silver |
Asiabasemetals and First Majestic Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Asiabasemetals and First Majestic
The main advantage of trading using opposite Asiabasemetals and First Majestic positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Asiabasemetals position performs unexpectedly, First Majestic can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in First Majestic will offset losses from the drop in First Majestic's long position.| Asiabasemetals vs. First Majestic Silver | Asiabasemetals vs. Ivanhoe Energy | Asiabasemetals vs. Orezone Gold Corp | Asiabasemetals vs. Faraday Copper Corp |
| First Majestic vs. Quisitive Technology Solutions | First Majestic vs. Canso Select Opportunities | First Majestic vs. Canadian General Investments | First Majestic vs. Sparx Technology |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Rebalancing module to analyze risk-adjusted returns against different time horizons to find asset-allocation targets.
Other Complementary Tools
| Odds Of Bankruptcy Get analysis of equity chance of financial distress in the next 2 years | |
| Portfolio Optimization Compute new portfolio that will generate highest expected return given your specified tolerance for risk | |
| Equity Valuation Check real value of public entities based on technical and fundamental data | |
| Equity Analysis Research over 250,000 global equities including funds, stocks and ETFs to find investment opportunities | |
| Pattern Recognition Use different Pattern Recognition models to time the market across multiple global exchanges |